Disallowance of late deposit of employees’ share of PF/ ESI beyond prescribed due date is sustained

Sushil Kumar Gupta & Co Vs ITO (ITAT Chandigarh)

ITAT Chandigarh held that disallowance for late deposit of employees’ share of PF/ ESI contribution to relevant funds beyond prescribed due date under respective Act is duly sustainable in law.

Facts- The Assessee’s return was processed by the CPC and order u/s. 143(1) was passed wherein the disallowance invoking the provisions of Section 143(1)(a)(iv) was made for fault of the assessee not to pay the employees’ contribution to PF/ESI before the prescribed due date under the relevant statue. Against the said intimation and the disallowance so made under section 36(1)(va) r.w. s 143(1)(a)(iv) of the Act, the assessee filed an appeal before the Ld. CIT(A), NFAC.

CIT(A) confirmed the same. Accordingly, being aggrieved, the present appeal is filed.

Conclusion- We are of the considered opinion that the ld. CIT(A) was justified in sustaining the adjustment u/s 143(1)(a) by means of disallowance made for late deposit of employees’ share of PF/ESI contribution to the relevant funds beyond the date prescribed under the respective Acts.

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